Backdating cases

Posted by / 07-Apr-2018 18:20

Backdating cases

There are several reasons for this difficulty, including that ambiguous law might govern the time of an event and relevant facts may be uncertain.Because they can create uncertainty regarding the date of an agreement, both present challenges for a lawyer considering backdating a document.Drafting and executing a document after an event occurs, but in a manner that accurately reflects the date on which the event transpired, is a permissible form of backdating.This is backdating that memorializes, something the United States Court of Appeals for the Seventh Circuit has recognized as a legitimate practice.As a matter of contract law, it is not always easy to determine when parties reached an agreement.An agreement is typically the product of various oral and written negotiations, which often take place over weeks or months.

Perhaps the highest profile of these cases was the SEC’s investigation of Apple Inc., its former general counsel and its iconic CEO, Steve Jobs.Perhaps the most fraudulent form of impermissible backdating is documenting and dating an act that never occurred. Additionally, backdating is impermissible when the backdated document describes an act that actually occurred, but at a date subsequent to the date of the document, in order to secure benefits to which a party is not entitled.For example, an attorney should never enhance the value of a client’s tax deductions by backdating documents to fraudulently indicate the client purchased the deduction-generating property on an earlier date.For example, if parties clearly reach an agreement on Dec.31, 2009, but do not execute a contract formalizing their agreement until Jan.3, 2010, the contract may be dated as of Dec. This is simply the accurate memorialization of a past event, something that is essential to legal practice.

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Another example of backdating that memorializes is drafting and executing records of action of a corporation’s board of directors after the board has adopted resolutions or taken other action.

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